The U.S. military’s lack of adaptability also puts DoD at a disadvantage against its primary competitor, China’s People’s Liberation Army. Unlike the Pentagon’s attempt to predict specific needs years in advance, the Chinese budget process rolls continuously from one year into the next and allocates money to services and bureaus in blocks that can pay for multiple functions or programs.
… Focusing Pentagon budgets on meeting demand rather than sustaining supply will require more funding flexibility and emphasizing the glue that operationally integrates forces in theater. Big changes like this will not happen overnight, but Congress could start the effort at budget reform with some pilot efforts that begin to reframe how budgets are built and executed.
The first and potentially most important reform could be mission-based funding to complement today’s program-based budgets. While systems like aircraft, radars, vehicles, or ships should continue to be funded via program elements, Congress could also appropriate funding for high-priority missions such as air and missile defense of forward bases in Japan or Poland. Mission element funding could be allocated by defense officials in collaboration with combatant commanders to buy operational infrastructure or new systems that fill seams between the military services’ offerings.
That was the excellent Dan Patt and Bryan Clark, “The Pentagon Needs Budget Agility to Compete with China.” A few thoughts:
(1) If radars, tanks, aircraft, etc., are still program elements, then they are not mission elements. That’s the status quo. Perhaps in full-rate production these types of weapons can be line-itemed, but one of Roper’s proposition is that even combat aircraft can benefit from quick, iterative development cycles. A major risk of leaving weapon line items alongside mission portfolios in the budget is that the former will likely be able to cancel any rivals as part of the latter. An F-35 program office could complain, for example, that NAVAIR is using some portfolio to prototype a competing aircraft, and that such prototyping is wasteful considering the F-35’s already approved multi-decade plan. The whole idea of mission elements starts to unravel, especially since new starts are controlled below the program/mission element level.
(2) The example of a mission account for air and missile defense in Japan or Poland seems unfortunate to me. That could create rigidity and new management layers in existing O&M and does not indicate how portfolios can help solve acquisition. I think a good rule for portfolios is that they shouldn’t result in reorganizations or changes in the flow of budget execution. Instead, existing organizations should be enable with programmatic flexibility. Another rule is that budgets and organizations shouldn’t have a many-to-many relation.
(3) The idea that budgets should focus on meeting demand rather than sustaining supply seems backwards to me. When uncertainty is high, it is better to focus on inputs rather than outputs. Only focus on outputs when you have a clear idea about causality in the system you’re manipulating. When budget lead times are measured in years, trying to meet future demand puts a huge strain on DoD’s predictive capabilities.
I agree that the structure of funding is the number one problem when it comes to DoD’s ability to innovate and stay ahead of China. Ultimately, the question is: Using what logic should existing program elements be consolidated into portfolios?
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